Date: December 14th, 2020
Livestock futures mixed on Friday and for the week. Beef and cash feedlot trade though very disappointing this past week. Beef down over $21 this past week and over $30 so far this month. Cash feedlot trade $2 to $5 lower than the week previous at $106 to $108 live and dressed trade $167 to $170. Exports for beef also not very impressive while pork continues to be strong into China, Japan and Mexico.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 12/11/2020
RECEIPTS: Auctions Direct Video/Internet Total
This Week: 354,700 27,000 5,500 387,200
Last Week: 278,600 34,500 60,000 373,100
Year Ago: 347,200 34,400 1,900 383,500
Compared to last week, steers and heifers sold uneven; ranging from mostly 5.00 lower to 5.00 higher. Many lightweight steer calves suitable for summer grazing weighing 300-450 lbs are still selling near or above the 2.00/lb level are selling with good demand. Yearlings are still in demand, but in many cases at lower prices but buyers are still seeking big yearlings that will squeeze into the April harvest slot. The large volume sales this week from Oklahoma through the Northern Plains had very large offerings of feeders as many are bringing calves to town before the end of the year as receipts at these large volume auctions swelled up. With one more week of sales and many late week sales this week will be done for the year has help inflate receipts this week. With many large volume auctions this week are adding up, and has caused some trucking shortages and outlets getting clogged. Very good weather over the country has feedlot and ground conditions dry and in good shape is helping to keep calves clean which helps the eye appeal for the feeders and has helped the movement of feeder cattle.
For the week, Friday December 4th through Friday December 11th, December Live Cattle -$.12, February +$.85, January Feeder Cattle -$.05, March +$1.12, December Lean Hogs -$1.20, February -$3.35. Boxed Beef, Choice -$21.14 @ $213.88, Select -$21.80 @ $195.71. Pork Carcass Cutout +$1.54 @ $79.71.
Cattle slaughter from Friday estimated at 118,000 head, up 1,000 from the week previous but down 5,000 from last year. Saturday’s kill estimated at 73,000 head bringing the week to date to 665,000 head, down 2,000 from the week previous and down 1,000 from last year. Beef production last week estimated at 559.0 million pounds. Year to date beef production -0.9% compared to last year with cattle slaughter -3.4%.
Hog slaughter from Friday estimated at 490,000 head, down 1,000 compared to week previous but up 4,000 compared to a year ago. Saturday’s kill is estimated at 314,000 bringing week to date up to 2,776,000 head, down 1,000 compared to the week previous but up 4,000 compared to a year ago. Pork production last week estimated at 607.1 million pounds. Year to date pork production +1.8% compared to a year ago with hog slaughter +0.7%
Boxed beef cutout values Friday, continued lower with 131 loads sold.
Choice Cutout__213.88 -.71
Select Cutout__195.71 -2.76
CME Feeder Cattle Index__136.66 -.45
CME Lean Hog Index__65.35 -.26
Pork Carcass Cutout__79.71 +1.28
IA-S.MN Wtd Avg Carcass Base__53.74 -.06
National Wtd Avg Carcass Base__53.44 -.77
December live cattle holding a lower trend since mid-August with cash convergence and nearby support from $107 to $108 and resistance around $110. The December contract is in delivery with volume getting thin and will expire at the end of the month. February live cattle also holding a lower trend with support around $110 and resistance at $113. January feeders holding a higher trend since mid-October with support around $135 and resistance at $142. December lean hogs expire today. February tested the support around $63, the recent low from last month, with resistance at $66.
Grains were higher on Friday and mostly higher for the week led actually this round by the wheat market. Wheat fundamentally and then technically driven higher for double digit gains, not only here in the U.S. but EU wheat futures as well. World wheat stocks decreased by USDA this past week as the market was expecting an increase. Russia downgraded its wheat’s production forecast from 81 MMT to 76.8 MMT as USDA increased its projection from 83.5 to 84 MMT. World stocks for corn and soybeans both decreased as well. Temps on the rise in South America, Brazil received welcome rains this past week while Argentina remained mostly dry.
For the week, Friday December 4th through Friday December 11th, March Corn +$.03, May +$.03 ¼, January Soybeans -$.02 ½, March +$.01, March KC Wheat +$.38 ½, May +$.35 ½, March Chicago Wheat +$.39, May +$.35 ¼, March MPLS Wheat +$.20 ½, May +$.19 ½, January Soybean Meal -$5.20/T, March -$2.50/T.
Overnight markets were mixed as wheat pulled back some from last week’s sharply higher rally and soybeans again take the lead higher. Corn finished the overnight steady to 2 higher, soybeans 6 to 12 higher and wheat 4 to 7 lower. Outside markets are supportive with equities and energies both pointing higher this morning and the US$ lower.
Wheat did begin the overnight higher as Russia announced plans to impose an export tax beginning February 15th and lasting until June 30th. The wheat export tax will be in addition to a grain export quota to be imposed for same period. These measures are being taken to stabilize the rising cost of domestic food prices. This had been in the rumor mills late last week. As the night progressed, profit taking hit the wheat markets has KC wheat hit a new recent high and Chicago wheat his testing nearby resistance.
Light rains fell over Brazil this past weekend with no significant rains in the forecast now for the next 2 weeks. The U.S. 6-10 day outlook showing normal to above normal temps for the entire country with below normal moisture for the Southwest and normal to above normal for the rest of the country.
March corn range bound so far this month from $4.14 ½ to $4.29 since hit a new contract high at $4.39 ½ on November 30th. January soybeans contract high was hit November 23rd right at the $12 mark, with nearby support around $11.42. March KC wheat into a new recent high overnight at $5.88 with resistance next up the $6 mark and support at $5.57. March Chicago wheat testing nearby resistance at $6.22 with the next at $6.37 and support at $5.87. January Soybean Meal with a contract high at $401.30 on November 25th yet trending lower since. Support is down at $376 with resistance up around $391.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700